EXPLAINER: Can climate change be solved by pricing carbon?

By Matthew Brown, The Associated Press, April 22, 2022

BILLINGS, Mont. (AP) — As climate change bakes the planet, dozens of nations and many local governments are putting a price tag on greenhouse gas emissions that are increasing flooding, droughts and other costly catastrophes.

Pennsylvania on Saturday becomes the first major fossil fuel-producing state in the U.S. to adopt a carbon pricing policy to address climate change. It joins 11 states where coal, oil and natural gas power plants must buy credits for every ton of carbon dioxide they emit.

President Joe Biden is attempting a less direct approach — known as the social cost of carbon — that calculates future climate damages to justify tougher restrictions on polluting industries. Republicans say that could crush many businesses. They want the U.S. Supreme Court to stop the administration after lower courts in Louisiana and Missouri split on the issue.

Governments elsewhere have moved more aggressively. Canada, for example, imposes fuel charges on individuals and also makes big polluters pay for emissions. It’s one of 27 nations with some kind of carbon tax, according to The World Bank.

The varied strategies come as scientists warn climate change is accelerating — and all can help reduce emissions. But experts say U.S. efforts have been hobbled by its fractured approach.

“Part of the reason you need all of these things to work in tandem is we do not have a federal climate policy,” said Seth Blumsack, director of the Center for Energy Law and Policy at Penn State University. “We have social cost of carbon used in regulatory decisions but not (a carbon price) that is faced by the market.”

SO WHAT’S THE PRICE TAG?

It varies. A lot.

The Biden administration’s social cost estimate is about $51, meaning every ton of carbon dioxide spewed from a power plant or tail pipe today is projected to contribute to $51 in economic damages in coming years. The state of New York has its own social cost of carbon, updated in 2020 to $125 a ton to account for economic trends.

By contrast, emissions were most recently valued at $13.50 per ton at auction under the Regional Greenhouse Gas Initiative in the Northeast, which Pennsylvania is joining. A similar “cap and trade” emissions program is in place in California, and one is due to go into effect in Washington state in 2023.

Canada’s carbon taxes include a minimum fuel charge for individuals equivalent to about $40 per ton.

WHY THE BIG DIFFERENCES?

The social cost of carbon attempts to capture the value of all climate damage, centuries into the future. Carbon pricing reflects how much companies are willing to pay today for a limited amount of emission credits offered at auction.

In other words, the social cost of carbon guides policy, while carbon pricing represents policy in practice.

“You’re trying to get the price to reflect the true cost to society,” said economist Matthew Kotchen, a former U.S. Treasury Department official now at Yale University. “A more stringent policy would have a higher carbon price. A more lax policy would give you a lower carbon price.”

In the most efficient world, economists say the two figures would line up, meaning there would be agreement about what climate change damages will cost and the policies used to address them.

IS ANY OF THIS WORKING?

Emissions from northeastern states would have been about 24% higher if the carbon pricing consortium hadn’t been in place, according to researchers from Duke University and the Colorado School of Mines.

The carbon auctions also have brought in almost $5 billion that can be used to reduce household energy cost increases and promote renewable energy.

The consortium began in 2009 — the year of a failed push in Congress to establish a nationwide cap and trade program. The bipartisan proposal died amid arguments over cost and whether climate change was even occurring.

Following lawsuits from environmentalists, President Barack Obama’s administration crafted the social cost of carbon and began including future damage estimates in cost-benefit analyses for new regulations. It was used under Obama more than 80 times, including for tightened vehicle emissions standards and regulations aimed at shuttering coal plants.

President Donald Trump moved to roll back many of the Obama-era rules — and to help justify the changes, the Republican administration cut the social cost of carbon from about $50 per ton to $7 or less. The lower number included only domestic climate impacts and not global damages.

“On its face that might sound okay, but when you think about it, global harms from climate change have implications in the U.S. in terms of the global financial system,” said Romany Webb, a climate change law expert at Columbia Law School.

WHAT’S NEXT?

On the day Biden took office, he set up an interagency group that revived the Obama estimate and promised a revised figure incorporating previously overlooked consequences of climate change. Many economists expect the revised figure to be higher, perhaps more than double the current $51.

Without a nationwide cap and trade program, environmentalists and some economists want the government to be more aggressive in using the social cost of carbon to overhaul government energy policy.

Under Biden, the U.S. Interior Department for the first time is applying climate damage considerations to oil and gas sales on public lands and waters. An upcoming lease sale in Wyoming, for example, could result in future emissions of 34 million tons (31 million metric tons) of carbon dioxide. That’s equivalent to more than $1.5 billion in future damages.

But the agency still plans to sell the leases because officials said there were no “established thresholds” to evaluate whether the increased emissions were acceptable, or not.

The expansion of carbon pricing into Pennsylvania remains tenuous. A legal challenge is pending and the state’s term-limited Democratic governor could soon be replaced by a successor who opposes the state’s participation.

“While pricing carbon would be the gold standard, it seems politically difficult to actually get there,” said Brian Prest with Resources for the Future, a Washington, D.C.-based research organization.

https://apnews.com/article/climate-biden-business-billings-environment-0835d2e4f113ad1c2c26747c69d9e6bf

Coastal disasters to cost $100B a year by 2100

A new White House report outlines troubling costs to taxpayers from climate change.

By Thomas Frank, ClimateWire, April 6, 2022

The damage caused by hurricanes and flooding will likely soar over the next 70 years due to climate change and could cost federal taxpayers nearly $100 billion a year by 2100, according to a new White House report.

An analysis by the Office of Management and Budget shows that increasing damage from coastal disasters is the single most severe threat to federal taxpayers related to climate change.

“The fiscal risk of climate change is immense,” Candace Vahlsing, OMB's associate director for energy and climate, and Danny Yagan, the office’s chief economist, wrote in a blog post accompanying a series of new reports on the federal budget and rising temperatures.

The reports include an analysis of four federal expenditures that are expected to increase due to climate change, and they project future costs under several climate scenarios. Under each one, coastal disasters account for at least 75 percent of the total costs.

By 2100, coastal disasters would cost taxpayers $94 billion per year in a worst-case climate scenario involving a 10-foot rise in sea levels. In a best-case scenario involving less warming, lower population growth and more technological innovation, coastal disasters would cost taxpayers $32.5 billion a year.

Three other climate costs OMB analyzed — crop insurance, wildfire suppression and health care expenses — would cost between $4 billion and $34 billion a year. The costs are calculated using the value of the dollar in 2020.

Climate change will increase coastal damage by intensifying hurricanes and flooding, the OMB said.

The report notes that “there is still uncertainty in how climate change will affect the frequency of tropical cyclones, with many studies suggesting a decrease in global frequency.” But there is “some evidence that the frequency of the most intense of these storms will increase in the Atlantic and North Pacific,” OMB said.

The budget office warns separately about billions of dollars in damage to federal buildings located in areas with a 1 percent annual chance of being flooded. There are 12,200 federal buildings and structures, worth $44 billion in total, that would be inundated under a worst-case climate scenario.

The report also says that climate change will reduce federal revenue due to lower economic output, which will add “hundreds of billions of dollars to the federal deficit.” U.S. gross domestic product, currently $21 trillion, could fall by 3 to 10 percent.

OMB wrote its report following an order last year by President Joe Biden to publish an annual assessment of climate-related fiscal risk exposure.

How to Defeat Putin and Save the Planet

Column by Thomas L. Friedman, The New York Times, March 29, 2022

It is impossible to predict how the war in Ukraine will end. I fervently hope it’s with a free, secure and independent Ukraine. But here is what I know for sure: America must not waste this crisis. This is our umpteenth confrontation with a petro-dictator whose viciousness and recklessness are possible only because of the oil wealth he extracts from the ground. No matter how the war ends in Ukraine, it needs to end with America finally, formally, categorically and irreversibly ending its addiction to oil.

Nothing has distorted our foreign policy, our commitments to human rights, our national security and, most of all, our environment than our oil addiction. Let this be the last war in which we and our allies fund both sides. That’s what we do. Western nations fund NATO and aid Ukraine’s military with our tax dollars, and — since Russia’s energy exports finance 40 percent of its state budget — we fund Vladimir Putin’s army with our purchases of Russian oil and gas.

Now, how stupid is that?

Our civilization simply cannot afford this anymore. Climate change has not taken a timeout for the war in Ukraine. Have you checked the weather report for the North and South Poles lately? Simultaneous extreme heat waves gripped part of Antarctica this month, driving temperatures there to 70 degrees Fahrenheit warmer than the average for this time of year, and areas of the Arctic, making them more than 50 degrees warmer than average.

Those are not typos. Those are crazy superextremes.

“They are opposite seasons — you don’t see the North and the South (Poles) both melting at the same time,” Walter Meier, a researcher with the National Snow and Ice Data Center, recently told The Associated Press. “It’s definitely an unusual occurrence.” And last Friday, no surprise, scientists announced that an ice shelf the size of New York City had collapsed in East Antarctica at the beginning of this freakish warm spell.

It was the first time humans observed “that the frigid region had an ice shelf collapse,” The A.P. noted, adding that if all the water frozen in East Antarctica melts, it would raise sea levels more than 160 feet around the world.

For all these reasons, I have been disappointed to see President Biden and Secretary of State Antony Blinken doubling down on our oil addiction, rather than tripling down on renewables and efficiency. Apparently spooked by bogus Republican claims that Biden’s energy policies are responsible for higher gasoline prices, his team has gone begging to some of the biggest petro-dictatorships in the world — Venezuela, Iran and Saudi Arabia, in particular — to get them to pump more oil and push down gasoline prices.

The truth is, even if we let U.S. oil companies explore for oil in every national park, the near-term effect on gasoline prices would not be all that significant. As CNN Business reported last week, in the past decade, the boom-to-bust U.S. oil industry spent tons of cash to fund all-out production growth, helping to keep prices low, but “sustaining profits proved elusive. Hundreds of oil companies went bankrupt during multiple oil price crashes, leading investors to demand more restraint from energy C.E.O.s.” So today, most U.S. oil company executives and investors “don’t want to add so much supply that it causes another glut that crashes prices. And shareholders want companies to return excess profits in the form of dividends and buybacks, not reinvest them in increasing production.”

The country with the most cheap, spare and flexible capacity to influence global oil prices in the short run is Saudi Arabia. But Russia is also a big player. That’s why just two years ago, President Donald Trump was begging Saudi Arabia and Russia to dramatically cut their production, because oil had fallen to around $15 a barrel on world markets — badly hurting U.S. oil companies, whose cost of extraction was $40 to $50 a barrel. The price collapsed because Saudi Arabia and Russia became embroiled in a price war over shrinking market shares in the pandemic.

Now Biden is begging the Saudis to dramatically increase their production to bring prices down. But the Saudis are mad at Biden for being mad at them for murdering the Saudi journalist Jamal Khashoggi — and are reportedly not taking Biden’s calls.

But the common denominator between Biden and Trump is the word “begging.” Is this the future we want? As long as we’re addicted to oil, we are always going to be begging someone, usually a bad guy, to move the price up or down, because we alone are not masters of our own fate.

This has got to stop. Yes, there needs to be a transition phase, during which we will continue to use oil, gas and coal. We can’t go cold turkey. But let’s vow to double the pace of that transition — not double down on fossil fuels.

Nothing would threaten Putin more than that. After all, it was the collapse in global oil prices between 1988 and 1992, triggered by Saudi overproduction, that helped bankrupt the Soviet Union and hasten its collapse. We can create the same effects today by overproducing renewables and overemphasizing energy efficiency.

The best and fastest way to do that, argues Hal Harvey, the C.E.O. of Energy Innovation, a clean energy consultancy, is by increasing clean power standards for electric utilities. That is, require every U.S. power utility to reduce its carbon emissions by shifting to renewables at a rate of 7 to 10 percent a year — i.e., faster than ever.

Utopian? Nope. The C.E.O. of American Electric Power, once utterly coal dependent, has now pledged to reach net-zero carbon emissions by 2050, using mostly natural gas as a backup. Thirty-one states have already set steadily rising clean energy standards for their public utilities. Let’s go for all 50 — now.

At the same time, let’s enact a national law that gives every consumer the ability to join this fight. That would be a law eliminating the regulatory red tape around installing rooftop solar systems while giving every household in America a tax rebate to do so, the way Australia has done — a country that is now growing its renewable markets faster per capita than China, Europe, Japan and America.

When cars, trucks, buildings, factories and homes are all electrified and your grid is running mostly on renewables — presto! — we become increasingly free of fossil fuels, and Putin becomes increasingly dollar poor.

Americans get it. Electric cars are now flying out of the showrooms. The biggest wind-energy-producing state in the country is politically red Texas, which generates more electricity from wind than the next three states (Iowa, Oklahoma and Kansas) combined. But making this a true national mission would get us to a clean power economy so much faster.

In World War II, the U.S. government asked citizens to plant victory gardens to grow their own fruits and vegetables — and save canned goods for the troops. Some 20 million Americans responded by planting gardens everywhere from backyards to rooftops. Well, what victory gardens were to our war effort then, solar rooftops are to our generation’s struggle against petro-dictatorships.

If you want to lower gasoline prices today, the most surefire, climate-safe method would be to reduce the speed limit on highways to 60 miles per hour and ask every company in America that can do so to let its employees work at home and not commute every day. Those two things would immediately cut demand for gasoline and bring down the price.

Is that too much to ask to win the war against petro-dictators like Putin — a victory in which the byproduct is cleaner air, not burning tanks?

“The clean alternatives are now cheaper than the dirty ones,” Harvey noted. “It now costs more to ruin the earth than to save it.” It also “now costs less to liberate ourselves from petro-dictators than to remain enslaved by them.”

That’s right. The technology is here. We can now put Putin over a barrel. It is just a matter of leadership and national will. What are we waiting for?

https://www.nytimes.com/2022/03/29/opinion/how-to-defeat-putin-and-save-the-planet.html

New Report: Carbon Pricing is Essential for Achieving a Clean, Reliable Energy Grid

Yahoo! News

March 16, 2022

WASHINGTON, DC – An economy-wide carbon price is key to ensuring all Americans have access to affordable and reliable electricity as we transition to a low-carbon economy, according to a new report released Wednesday by the Climate Leadership Council at a virtual event. The report, co-authored by former FERC Chair Neil Chatterjee and Council CEO Greg Bertelsen, outlines why a carbon price and a more reliable energy grid are essential for meeting deep decarbonization goals by midcentury.

“In order to successfully decarbonize the U.S. economy, we will need to increase our reliance on the electric grid. As this transition takes place, the grid is coming under unprecedented strain from more frequent and prolonged extreme weather events,” Bertelsen said. “Thankfully, carbon pricing is naturally aligned with grid reliability. It works within our existing energy system to add capacity where it is needed and to reduce demand where possible, providing the maximum flexibility as we make the much-needed clean energy transition.”

Among its key findings, the report, “Achieving Grid Reliability and Decarbonization through Carbon Pricing,” highlights how a carbon price improves grid reliability:

• Carbon pricing is technology- and location-neutral. Because carbon pricing does not pick which zero- and low-carbon options contribute to the resource mix, it efficiently moves the power sector toward the right set of resources to deliver emissions reductions and ensure sufficient energy supply and operating reliability to meet customer demand, all at least cost.

• Carbon pricing sends a steady, predictable price signal. This provides investors, grid operators and power system planners with better data to forecast supply and demand trends and accommodate emerging and new technologies with a variety of attributes to build out the grid of the future.

• Carbon pricing fosters economy-wide innovation. This allows the U.S. to decarbonize its entire economy rapidly while creating headroom for the power sector to decarbonize in a manner that supports reliability for consumers.

Curt Morgan, CDEO of Vistra Corp., a leading integrated retail electricity and power generation company, says achieving grid reliability is foundational to addressing climate change. “The push for lower carbon emissions will require greater electrification of the economy, which means a dramatic increase in demand for electricity,” Morgan said. “Electricity is the lifeblood of the American economy, so we must accomplish the transition to a carbon-free grid by balancing affordability, emissions, and reliability. Decarbonizing the electric sector and the broader economy with a price on carbon is the most efficient, equitable, and transparent way to incentivize investments in low- to no-carbon resources. In addition, coupling a carbon border adjustment fee with a price on carbon will ensure the competitiveness of U.S. companies and incentivize the international community to participate in decarbonization. This will provide the least disruptive transition to a carbon-free economy while ensuring Americans and American companies have a level playing field.”

https://news.yahoo.com/report-carbon-pricing-essential-achieving-175111645.html

In Virginia, abandoned coal mines are transformed into solar farms

Six old mining sites owned by the Nature Conservancy will be some of the first utility-scale solar farms in the region — and the nonprofit group hopes the model can be replicated nationwide

By Zoeann Murphy, The Washington Post, March 3, 2022

Empty freight cars line the railroad tracks as far as the eye can see from Tim Jennings’s backyard in Dante — a town of less than 600 residents.

“They should open up some more new mines around here,” the 61-year-old former coal miner says, pointing up at the mountains surrounding the valley. “Solar panels — that might work too.”

In southwest Virginia, abandoned coal mines are being transformed into solar installations that will be large enough to contribute renewable energy to the electric grid. Six old mining sites owned by the Nature Conservancy will be some of the first utility-scale solar farms in the region — and the nonprofit group hopes it’s creating a model that can be replicated nationwide.

In 2019, the Nature Conservancy acquired 253,000 acres of forest in the central Appalachian Mountains that it calls the Cumberland Forest Project. It’s one small part of the group’s efforts in the mountain range, which reaches from Alabama to Canada.

“We’ve identified the Appalachians as one of the most important places on Earth for us to do conservation,” says Brad Kreps, the Nature Conservancy’s Clinch Valley program director, who is leading the solar projects. “We put the Appalachians in a very rare company along with the Amazon, the wild lands of Kenya and the forests of Borneo.”

The Cumberland Forest includes several abandoned mine sites scattered around Virginia’s coal fields region. Solar developers partnering with the Nature Conservancy, such as Dominion Energy and Sun Tribe, say the mine sites have vast flat areas exposed to sunlight that are a rarity in the mountains, and the sites offer advantages like being close to transmission lines.

“In the coalfield region, there’s about 100,000 acres that’s been impacted from mining,” points out Daniel Kestner with the Virginia Department of Energy. “Better to build on a lot of these mine sites than some prime farmland or some areas that maybe don’t want solar in their community.” He’s also hopeful the projects will bring tax revenue and jobs to the area.

Nationwide coal mining jobs dropped from more than 175,000 in 1985 to about 40,000 in 2020, according to a recent Interagency Working Group on Coal and Power Plant Communities report. Solar won’t replace what was once reliable long-term work. The jobs will primarily be in construction.

Lou Wallace, Board of Supervisors chairperson for Russell County, Va., is pushing for counties in the coal fields to diversify their economies. She’s been promoting the beauty of the area’s rivers and mountains for recreation and tourism. Her family relied on coal for generations.

“We’re very proud to be an energy-producing community,” she says when asked about the new solar farms being built on abandoned coal mines. “This is helping us to reimagine how we produce the energy. So we’re still able to say we’re keeping the lights on somewhere.”

https://www.washingtonpost.com/climate-solutions/2022/03/03/coal-mines-solar-farms-climate-change-video/?utm_medium=email&utm_source=newsletter&utm_campaign=wp_energy_and_environment&wpisrc=nl_green

Coastal Sea Levels in U.S. to Rise a Foot by 2050, Study Confirms

More precise measurements indicate that the increase will happen “no matter what we do about emissions.”

By Henry Fountain, The New York Times, Feb. 15, 2022

Sea levels along the coastal United States will rise by about a foot or more on average by 2050, government scientists said Tuesday, with the result that rising water now considered “nuisance flooding” will become far more damaging.

A report by researchers from the National Oceanic and Atmospheric Administration and other agencies also found that, at the current rate of warming, at least two feet of sea-level rise is expected by the end of the century.

“What we’re reporting out is historic,” said Rick Spinrad, the NOAA administrator, at a news conference announcing the findings. “The United States is expected to experience as much sea level rise in the next 30 years as we saw over the span of the last century.”

Dr. Spinrad said that while cutting greenhouse gas emissions to limit warming was critically important, the projected sea level rise by 2050 “will happen no matter what we do about emissions.”

The report is an update of a 2017 study, and is similarly based on data from tide gauges and satellite observations.

But the new study has relatively precise estimates of sea level rise by 2050, a result of improved computer modeling and better understanding of the impact of global warming on the huge Greenland and Antarctic ice sheets. That is “providing more confidence in our ability to predict” effects by midcentury, said William Sweet, an oceanographer with NOAA’s National Ocean Service and an author of the report.

About 40 percent of the United States population, or 130 million people, live within 60 miles of the ocean. But sea level rise will not affect all of them equally, because it is not uniform.

In the United States, land subsidence and compaction of sediments along much of the East and Gulf coasts add to the increase; in those areas sea level rise may exceed one foot in the next three decades, the report said.

On the West Coast, sinking land and compaction are less common, so sea level rise is expected to be at the lower end of projections.

The report said that the calculated rise over the next three decades means that floods related to tides and storm surges will be higher and reach farther inland, increasing the damage.

What the report described as moderate or typically damaging flooding will occur 10 times more often by 2050 than it does today. Major destructive coastal floods, although still relatively rare, will become more common as well.

For communities on the East and Gulf coasts, the expected sea level rise “will create a profound increase in the frequency of coastal flooding, even in the absence of storms or heavy rainfall,” said Nicole LeBoeuf, director of the National Ocean Service.

Currently many communities on those coasts experience regular “nuisance” or “sunny day” flooding, when high tides become even higher because of the influence of the moon, wind or other factors.

But what were once nuisance floods are likely to become damaging, Dr. Sweet said.

“We definitely are predicting a flood regime shift,” he said.

The report projects that sea levels will rise an average of 10 to 12 inches by 2050, which is about as much as the increase during the 100 years from 1920 to 2020. Those projections don’t change no matter how much greenhouse gas emissions are cut over that time.

Estimates for sea level rise by 2100 in the report are less certain. But in this case, the worldwide trajectory of emissions will have a significant effect. Allowing emissions to continue unabated could add 1.5 to 5 feet more to sea levels by the end of the century, for a total of up to 7 feet, the report concluded.

The report provides detailed sea level projections for states and territories by decade for the next 100 years. Dr. Spinrad said it was meant to help local officials, planners and engineers make decisions about where to locate or how to protect critical infrastructure like roads, wastewater treatment systems and energy plants, and otherwise adapt to rising waters.

He described the report as a “wake-up call” for the United States. “But it’s a wake-up call that comes with a silver lining,” he said. “It provides us with information needed to act now to best position ourselves for the future.”

https://www.nytimes.com/2022/02/15/climate/us-rising-sea-levels.html?searchResultPosition=1